Securities industry in China is an article on the securities industry in mainland China.

History

Regulation

In mainland China, the China Securities Regulatory Commission is the primary regulator; however, it has delegated certain activities to a self-regulatory organization called the Securities Association of China (SAC).

Mainland China began an IPO sponsor system began in 2004, which is similar to a sponsor system in Hong Kong began in 1999.[4] In order to be publicly listed in China, a prospective listing firm must be sponsored by a securities company (investment bank) and the sponsor must assign sponsor representatives to the listing firm.[5] This In 2012, the SAC took over registration of sponsor representatives. The exam to become a sponsor representative is extremely difficult, with a one percent passing rate,[4] and sponsor representatives have been highly compensated, with $1 million annual salaries in 2010. Despite this, they are viewed as often ineffective.[4]

Equity share types and foreign investment

Mainland shares are known as A-shares and are not typically available for purchase by foreigners. B-shares are available to foreigners, but are reputed to be more risky as they are available for less desirable companies. H-shares are for mainland China companies which are traded on the Hong Kong Stock Exchange.

Institutional investors can apply to become Qualified Foreign Institutional Investors (a program which began in 2002) and then are allowed to buy A-shares; the minimum assets under management was reduced from $5 billion to $500 million in 2012.[6]

On 10 November 2017, China allowed foreign participation up to 51% in securities ventures.[7]

On March 13, 2020, the Securities Regulatory Commission announced that the restriction on foreign shareholding ratio of securities companies will be abolished from April 1, 2020, and qualified foreign investors may submit applications for the establishment of securities companies or change of the actual controller of the companies in accordance with the requirements of laws and regulations, relevant regulations of the SFC and relevant service guidelines in accordance with the law. In the presence of the huge Chinese market, foreign-owned brokerage firms are coming in droves.[1]

Local securities companies

2010, there are 106 Members of Securities Association of China[8]

Rankings

Domestic rankings in 2010

  1. Sponsor representatives
Ranking Company No. of sponsor representatives No. of professionals
1 Guosen Securities[12] 139 400
2 CITIC[10] 91 583
3 Ping An[23] 84 266
4 Guangfa 76 300
5 Huatai 76 301
6 Haitong 70 230
7 China Merchants 70 254
8 Essence 60 230
9 Everbright 59 209
10 CICC 57 1249

2. Net brokerage revenue

Ranking Company Net brokerage revenue (RMB 1B) Market share among top 100 brokers (%) No. of branches Net brokerage revenue per branch (RMB 1M)
1 Galaxy 5.6 5.24 219 25.8
2 Guotai Junan 5.0 4.68 189 26.7
3 Guosen Securities[12] 4.9 4.54 68 71.9
4 Guangfa 4.7 4.39 194 24.3
5 Haitong 4.6 4.25 188 24.3
6 Shenyin Wanguo 4.4 4.05 149 29.3
7 China Securities 3.5 3.25 123 28.4
8 Huatai Lianhe 3.5 3.24 128 27.2
9 China Merchants 3.3 3.09 263 12.6
10 Qilu 3.3 3.08 140 23.7

3. Total assets

Ranking Company Total assets (RMB 1B)
1 Zhong Rong 110.0
2 CITIC[10] 109.4
3 Haitong 100.7
4 Guotai Junan 93.6
5 Guangfa 91.0
6 Galaxy 90.1
7 China Merchants 89.6
8 Huatai Lianhe 86.5
9 China Securities 66.9
10 Guosen Securities[12] 63.7
11 Shenyin Wanguo 60.2

Source: Securities Association of China[8][24]

Global rankings in 2010 & 2011Q1 1. Sponsored deals

Company 2011Q1 Ranking 2011Q1 Market share 2010 Ranking 2010Market share Change in market share
Deutsche Bank 1 8.60 4 5.3 3.3
Barclays Capital 2 6.80 12 2.2 4.6
Goldman Sachs 3 6.70 3 6.7 0.0
Citi 4 4.40 9 3.5 0.9
Guosen Securities[12] 5 4.10 14 1.7 2.4
BoA Merrill Lynch 6 4.00 6 4.9 -0.9
Morgan Stanley 7 4.00 1 8.4 -4.4
DBS Group 8 3.80 39 0.5 3.3
JP Morgan 9 3.40 2 6.8 -3.4
Ping An[23] 10 3.00 13 1.9 1.1

Source: Bloomberg

References

  1. ^ https://web.archive.org/web/20120402232834/http://zq.100xuexi.com/HP/20100509/DetailD1027800.shtml. Archived from the original on April 2, 2012. Retrieved September 26, 2011. ((cite web)): Missing or empty |title= (help)
  2. ^ "《证券公司分类监管工作指引(试行)》发布_证券新闻_财经_腾讯网". Finance.qq.com. Retrieved 2012-08-04.
  3. ^ (2010-08-23 01:25:10) (2010-08-23). "中国证券业发展现状点评_花树_新浪博客". Blog.sina.com.cn. Retrieved 2012-08-04.((cite web)): CS1 maint: numeric names: authors list (link)
  4. ^ a b c Changxin G. (2011). Lack of due diligence makes it difficult for traders to take stock. Chinadaily.
  5. ^ [CSRC Decree No.58]: Administrative Measures on Sponsorship for Securities Issuance and Listing Archived 2011-11-28 at the Wayback Machine. China Securities Regulatory Commission.
  6. ^ New Chinese policy may favor big foreign investors. Pensions & Investments.
  7. ^ "China Makes Historic Move to Open Market for Financial Firms". Bloomberg.com. 10 November 2017.
  8. ^ a b "中国证券业协会" (in Chinese). Cx.sac.net.cn. Retrieved 2012-08-04.
  9. ^ "招商证券". Newone.com.cn. 2012-03-08. Retrieved 2012-08-04.
  10. ^ a b c "中信证券 CITIC Securities". Cs.ecitic.com. Retrieved 2012-08-04.
  11. ^ "Everbright Securities Co Ltd". Everbright Securities Co Ltd. Retrieved October 13, 2012.
  12. ^ a b c d e "国信证券-金色阳光藏金阁,全方位看投资,专业甄选,个性理财". Guosen.com.cn. Retrieved 2012-08-04.
  13. ^ http://www.htsec.com
  14. ^ "Welcome to". Htsc.com.cn. Retrieved 2012-08-04.
  15. ^ "平安证券官方网站-证券-证券公司-证券交易". Stock.pingan.com. Retrieved 2012-08-04.
  16. ^ Securities Division Risks Ping An Reputation. Caixin.
  17. ^ "广发证券". Gf.com.cn. Retrieved 2012-08-04.
  18. ^ "高盛高华". Gsgh.cn. Retrieved 2012-08-04.
  19. ^ Guangfa Securities achieves back-door listing, shares soar.
  20. ^ "申银万国证券". Sywg.com. Retrieved 2012-08-04.
  21. ^ "中银国际证券". Bocichina.com. 2006-05-12. Retrieved 2012-08-04.
  22. ^ http://dnb.alacrastore.com/storecontent/dnb2/529812021 Chinalions Securities Co., Ltd. dba Hualin Securities Co., Ltd. Gangkou Road Sales Department (Branch)
  23. ^ a b "平安证券官方网站-证券-证券公司-证券交易". Stock.pingan.com. Retrieved 2012-08-04.
  24. ^ "Archived copy". www.sac.net.cn. Archived from the original on 28 November 2011. Retrieved 17 January 2022.((cite web)): CS1 maint: archived copy as title (link)